South Korea Finance Stablecoin

South Korea is developing a regulatory framework for stablecoins as part of its broader effort to develop a digital asset industry. South Korea’s emerging stablecoin framework could create opportunities for U.S. financial services companies across the broader digital asset ecosystem. Beyond stablecoin issuance, U.S. firms could also provide payment and settlement infrastructure for cross-border and B2B transactions, including transaction processing, treasury management, and blockchain-based settlement.

South Korea’s first digital asset legislation, the Virtual Asset User Protection Act, took effect in July 2024. The law strengthened the regulatory framework for virtual assets trading by introducing requirements for user asset protection, market surveillance, and penalties for unfair trading activities. This provided a more structured regulatory foundation for the country’s existing virtual asset market, where stablecoins such as USD Tether (USDT) and USD Coin (USDC) can be traded and transferred through regulated virtual asset service providers. However, despite growing demand for U.S. dollar-denominated stablecoins, the law does not provide a comprehensive framework for stablecoin issuance, distribution, and use beyond virtual asset trading.

The Korean government is now preparing for the second phase of regulations through the Digital Asset Basic Act. Building on the consumer-protection and market-oversight framework measures established in 2024, the legislation is expected to establish governing rules for digital asset-related business activities, including the issuance, distribution, and use of stablecoins. The government and ruling party have set a goal of passing the legislation by the end of 2026. As of September 2026, multiple related bills remain pending in the National Assembly, while the government and ruling party are working to consolidate them into a unified bill.

One key issue under discussion is the issuance of Korean won-denominated stablecoins. Policymakers are considering a bank-centered model, under which banks would hold at least 50% plus one share of an issuing consortium, although the final structure remains under discussion. The Bank of Korea supports a cautious approach, citing potential impacts on financial stability, monetary policy, foreign exchange markets, and the payment system. Policymakers are also considering the potential use of stablecoins for payments and funds transfers beyond digital asset trading, but such applications remain at an early stage.

For U.S. financial service providers, numerous opportunities exist in the digital asset sector, including beyond stablecoin issuance. U.S. stablecoin issuers and payment companies could also explore partnerships with Korean banks and fintech firms to facilitate the use of U.S. dollar-denominated stablecoins for cross-border payments and settlement, subject to Korea’s final rules on foreign-issued stablecoins. Over the longer term, firms that can connect stablecoins with existing customer networks, financial products, and corporate treasury systems could play a role as stablecoins become more integrated into traditional financial infrastructure.

For additional market information, please contact the U.S. Commercial Service Korea: Office.Seoul@trade.gov